## How to use this FD Calculator?

• Use the slider for Selecting Monthly Amount
• Select the tenure in Months using slider
• Move the slider and select the Interest Rate
• Recalculate your FD anytime by changing the input sliders
• FD Amount will be calculated instantaneously when you move the sliders.
FD or Fixed Deposits are long-term investment tool which helps investors save money for the long term. Investors can choose a fixed tenure for which the deposit will be kept with the bank. In general, FD investments are better for those looking for long-term wealth creation as they offer high interest rates as compared to savings accounts.

## How is FD interest calculated?

Interest on FD is compounded quarterly, in most banks. The formula for this is: A = P * (1+ r/n) ^ n*t , where I = A – P A = Maturity value P = Principal amount r = rate of interest t = Number of years n = Compounded interest frequency I = Interest earned amount

## Benefits of FD

• FD can be used as collateral for taking loans. You can take up to 80-90% loans on your FD amount
• The depositor can choose to transfer the amount at the time of maturity for a further Fixed Deposit.
• The money can be deposited only once. Once deposited, withdrawal of money from the account will accrue a penalty.
• FD schemes are good investment tools for those who have surplus funds and want to earn money from it.

## Tax Benefits on FD

Similar to other personal tax-saving and investment instruments, Fixed Deposits schemes also attract taxes. A TDS of 10% is deducted on the returns accrued from an FD if the total interest exceeds Rs. 10,000 in a single financial year. Let’s compare this to the SIP scheme and you can see that SIPs are more beneficial for the long term. Since long-term gains from equity are tax-free, any SIP which invests in ELSS (Equity Linked Mutual Funds) is also tax-free after one year.